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UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as Ev.1666-i House of COMMONS MINUTES OF EVIDENCE TAKEN BEFORE ENVIRONMENTAL AUDIT committee
THE KYOTO PROTOCOL: BEYOND 2012
TUESDAY 17 OCTOBER 2006
IAN PEARSON MP, and MS DAGMAR DROOGSMA Evidence heard in Public Questions 1 - 64
USE OF THE TRANSCRIPT
Oral Evidence Taken before the Environmental Audit Committee On Tuesday 17 October 2006 Members present Mr Tim Yeo, in the Chair Mr Martin Caton Mr David Chaytor Tim Farron Mr Nick Hurd Mark Pritchard Dr Desmond Turner Joan Walley ________________ Memorandum submitted by the Department for Environment, Food and Rural Affairs
Examination of Witnesses
Witnesses: Ian Pearson, a Member of the House, Minister of State (Climate Change and the Environment), and Ms Dagmar Droogsma, Team Leader on Future Action, Global Atmosphere Division, Department for Environment, Food and Rural Affairs, gave evidence. Q1 Chairman: Mr Pearson, welcome. This is your first appearance before the Committee since you became Minister. Perhaps I may say at the outset that Colin Challen had hoped to be here but unfortunately he is in St Thomas's Hospital having had an accident. We understand that it is not too serious, but it is certainly serious enough to keep him away from here today and tomorrow. To kick off with a general point, is it right that you have been in the job for five months? Ian Pearson: That is right. Q2 Chairman: What are your overall impressions? Do you believe that people in Britain, consumers and businesses, are sufficiently seized of the urgency of climate change? Ian Pearson: Increasingly so, yes. Quite a lot of research has been commissioned to analyse people's views. Overwhelmingly, people are aware of climate change; they regard it as an important issue. What is less understood is how individuals can contribute to reducing their own carbon footprint. As a government that is trying to spread greater awareness of climate change but is also encouraging a change in behaviour we have a climate change communications initiative. David Miliband has been talking about moving towards one planet living. At the moment, we consume resources as if we had three planets. If everybody did the same thing it would be completely unsustainable. Therefore, to move towards one planet living and reduce the carbon footprint of government, business and citizens must be an important part of our agenda. Q3 Chairman: Do you think that the science is becoming more worrying and the situation may be even more risky and urgent than we are currently assuming? Ian Pearson: Some of the most recent scientific reports have been very worrying. There is no doubt that the overall message must be one of increasing urgency. This is an issue that we need to tackle. I do not believe there is any serious debate about the science of global warming and the fact that humankind is responsible for CO2 emissions and the problem of climate change. The debate is about how fast this process is taking place and, therefore, how urgent the international response needs to be. Q4 Chairman: Quite rightly and understandably, there has been a lot of emphasis on targets for cutting annual greenhouse gas emissions and the whole Kyoto process has focused upon that. Do you think there is a risk that that may now deflect attention away from the concentrations and build up of greenhouse gases in the atmosphere which are the trigger for dangerous and irreversible climate change, as opposed to any particular annual level of emissions? We have had so much stress on emissions that people may feel if we can cut them by 60 per cent by 2050 we may have solved the problem. If all of that cut arises in the past five years clearly we have not solved the problem. Do you think it would be better if we paid a bit more attention to the level of concentration now and reminded people that we might be quite close to an irreversible tipping point? Ian Pearson: I think we need to do both but certainly it is important to focus on the overall concentrations. It is the area under the curve that is important. You are right to say that we cannot be in a situation where we set a target for 45 to 50 years hence and then take action right at the end of it, because it is the cumulative CO2 emissions that are the problem. Q5 Chairman: We are all looking forward to the Stern review. Can you tell us when it will appear? Ian Pearson: Shortly. Q6 Chairman: Is that "shortly" in Treasury speak, which usually means later rather than sooner? Ian Pearson: As far as I am aware, the intention is to publish its findings before the pre-Budget report. Q7 Chairman: But not necessarily before Nairobi? Ian Pearson: I do not have the exact date. Q8 Joan Walley: Would you like it to be published before Nairobi? Ian Pearson: Just as in Monterrey in Mexico Nick Stern turned up and gave a preview of his findings I am sure that those findings will also be available at Nairobi. What is clear, without pre-empting the publication of the report, is that the costs of not tackling climate change are far higher than those associated with tackling it. That is one of the key messages we all need to take away from the report. Q9 Chairman: Before we get to the COP and MOP agenda, if as everyone seems to expect the report will be quite convincing on that point will it be followed by a further analysis of the Government's own position? It seems to this Committee that a certain amount of low fruit is not being picked, for example in relation to energy efficiency and maybe road transport. Some straightforward things could be done to accelerate the use of up-do-date technology and so on. If there is a convincing analysis will there be a fairly urgent response from the Government? Ian Pearson: We continue to keep under review the range of policy instruments that we have in the UK to tackle the domestic climate change agenda. As you know, we have set the target of reducing CO2 emissions by at least 60 per cent by the year 2050. We have stretched the UK target of a 20 per cent reduction by 2010. The climate change programme that we published in March gets us to about 16.2 per cent, so it does not achieve the target that we set ourselves. There are a number of reasons why we are still short of that at the moment. We have said that this is not the last word on the issue and we want to see what more we can do. If the Committee has good suggestions about low-hanging fruit, as you call it, I would certainly be very interested to hear them. We fully accept that as a government we need and want to do more for the future. Chairman: I daresay that we will want to have an early look at Stern as soon as it comes out, so we may respond to that. Q10 Mr Hurd: I apologise that my question is a little out of context, but I have to leave early. Given the difficulty of reducing emissions, I am sure you agree about the importance of enhancing our natural carbon sinks. In that context what support is the British Government giving to the idea of conservation credits for rain forests? Ian Pearson: We are certainly attracted to the idea of conservation credits. I know that you raised this as an issue in the debate last Thursday. You will have seen from my reply that of other suggestions that have been made we think that perhaps this is the best way forward. Q11 Mr Hurd: What are the difficulties associated with it? Ian Pearson: As you are aware, this is a hugely complex and difficult area. There are a lot of methodological issues involved in this area, as I understand it. When one looks at the scale of deforestation and its carbon impact it is clear that it is an area where we need to do something. That is why conservation credits seem to us in the UK to be a potential way forward, just as approaches in other sectors are areas that we think need to be explored if we are to have a comprehensive range of tools to tackle carbon emissions. Q12 Mr Hurd: Will we be actively promoting it, or is our support passive? Ian Pearson: What I can say is that at the moment we are fully engaged in the debate and we see it as being the leading runner of a number of different possibilities. What we want is something that works. Q13 Mr Chaytor: Can you tell us something about progress on the Gleneagles dialogue, specifically what happened in Mexico and how it is being taken forward? Ian Pearson: The UK was well represented at Mexico. I was not there but David Miliband as Secretary of State, Malcolm Wicks as Energy Minister and Margaret Beckett as Foreign Secretary were there. The judgment we made was that my presence would be one air flight too many. What we did at Monterrey was to look seriously at the economics of climate change and reduction. Sir Nicholas Stern gave a report on that. We looked at the costs of introducing low-carbon energy technologies. There was a report from the International Energy Agency on its energy technology perspectives. If you have not read the document I would thoroughly recommend it to Members of the Committee because it is a serious analysis of the different technology options that are available. That would be a contribution to the continuing future debates that we need to have in this area. The third area looked at and discussed in Monterrey was the whole issue of the way in which international financial organisations can contribute to providing finance to achieve the transition that we need to see to low-carbon economies in developing countries. Delegates at Monterrey heard the World Bank's energy investment framework proposals. Again, that is a matter where the UK has been playing a leading role in pushing forward these proposals. I am pretty excited about the fact that if we can get an energy investment framework fund of something in the region of the $20 billion that has been talked about to help developing countries introduce low-carbon energy solutions that will be a huge practical step forward. Q14 Mr Hurd: All of these three areas reflect the work programme of the dialogue, but do you think that the programme or the building of a general consensus is the most important part of it? When is the work programme going to be completed? Ian Pearson: Certainly, I believe that the general process of consensus building is important, but the different elements of the work programme are also significant and the fact that practical actions are emerging from the dialogue process in terms of co-operation with countries like South Africa to do specific pieces of work will make a difference. As to the dialogue process, we will be reporting back as part of the Japanese presidency. I am also pleased that the Germans have agreed to host a meeting next year as part of their presidency, which is important. As I see it, the key things are to get some concrete, practical action taken to continue to build international consensus on the science and practical actions in terms of what needs to be done if we are to tackle this. I see the Gleneagles process as a very important adjunct to the UN process. It is a very positive space in which we can debate ideas and throw out suggestions about how we can move the whole issue forward. Q15 Mr Hurd: Is that not precisely what should be done through the UN convention process and dialogue and the ad hoc working group? What is Gleneagles going to produce that could not be dealt with in the two existing processes? Is it not to some extent a distraction from the two existing processes? Ian Pearson: I do not believe that it is a distraction; it is complementary and helpful to the overall view and negotiation process. My understanding of negotiations is that very often you keep your position close to yourself. That is certainly my experience as a trade minister, and from talking to people that seems to be the case when it comes to negotiations on climate change. I think that to have a space where you can throw out ideas and you are not part of a negotiating machinery is very helpful. I believe that the Gleneagles dialogue is filling that important gap. Q16 Mr Hurd: What happens if the outcome of the work programme for the Gleneagles dialogue is largely at odds with the outcome of the ad hoc working group? Is there not a danger that we will have a series of irreconcilable conflicts? Ian Pearson: I do not believe that it will be at odds. Q17 Mr Hurd: If it is not why do we need it? Ian Pearson: I think we need it for the reasons I was trying to explain. Q18 Mr Hurd: To clarify it, surely if it is the case that the Gleneagles dialogue has something distinct to offer inevitably to some extent it will be at odds with the ad hoc working group. If it does not have anything distinct to offer why have it in the first place? Ian Pearson: What is unique about the Gleneagles dialogue is that one has countries working together to analyse and share the problem and come up with solutions, rather than countries that negotiate on the basis of their own vested interests. The debates that are had through the Gleneagles dialogue are a different paradigm from the negotiations that take place under the formal UN procedures. That is why I say it is complementary and important, because if we can build consensus there I think we have a better chance of achieving a negotiated agreement through the UN framework. Q19 Mr Hurd: Will it continue beyond 2012? Ian Pearson: I do not think that at the moment decisions have been made about that. Q20 Mr Hurd: You will have seen yesterday's Independent which ran a major story on emissions from flights of government ministers. Your department was listed in the league table of emissions. Is there not a danger that in the whole climate change negotiation industry we are contributing to an increase in emissions through the huge amount of international travel that is involved? What is the Government doing to offset the emissions resulting from the Gleneagles dialogue and attendance at the other UN processes? Ian Pearson: Frankly, I think that to take figures for government's airline emissions and say that they are contributing to the problem is a cheap shot.. We will not get an international agreement to tackle climate change by email or over the phone; that simply is not going to happen. The figures for 2005 were during our presidency of the G8 when we had lots of formal commitments to make, so we have to travel, and will continue to travel, just as we are going to Nairobi if we are to reach a successful international agreement on these issues. As a government we have been offsetting the carbon impact of all our official flights since last year and will continue to do so when we have a government carbon offsetting fund in which we will be investing those offsetting proceeds. Q21 Tim Farron: Following along similar lines that David Chaytor has been pursuing, you mention in your preamble that people are not always clear about what they can do to tackle climate change, but I suggest there is also lack of clarity over the international response. Do you agree there is a risk that all the various meetings and initiatives, some of which we have referred to already, could blur the focus, bemuse the public and lead them to believe, rightly or wrongly, that politicians are not taking decisive action? Ian Pearson: There is quite a complicated architecture when considering the series of meetings and fora and discussing climate change. Trying to explain that to this Committee, let alone the British public, is quite difficult. I am assured, however, that those who are at the coal face in terms of negotiating and attending meetings are pretty well aware of their respective roles and responsibilities. But I agree there is an issue of public confidence and that people in Britain want to see the Government taking a leadership role when it comes to climate change. They want to know that we are working as hard as we can to get an international agreement which will avoid dangerous climate change in future. We need to get our messages across as a government, recognising the complexities of decisions and negotiations but giving people the confidence that government is on their side and is pressing hard to tackle these problems. Q22 Tim Farron: Is not part of that leadership selling what you are doing in a much clearer way on an international level so that people feel that what they are doing is being led and they are not just fighting against great international forces that are not moving? Ian Pearson: We certainly need to be clear about how we communicate our international climate change policy. I do not know about you, but I think people understand that we are trying hard in this. It is a big problem and we are one of a large number of countries. There are some big countries such as the United States that are responsible for a lot of carbon emissions and have not been part of Kyoto and do not show willingness at government level to take action for the future. I think people understand some of the difficulties, but I hope they appreciate that we are trying hard as a government. Q23 Tim Farron: As a related question, is there also a danger in having too many meetings, initiatives and strands of discussion in the sense that the various departments have or have not the capacity adequately to handle the various international discussions and negotiations? Can you and your colleagues deal with the proliferation of strands that appear to have come out of this line of work? Ian Pearson: As a government, yes, we can. I have always been one of those people who think that we can have too many meetings and what we want is action, but when it comes to climate change we need a lot of meetings if we are to get people to agree to tackle CO2 emissions in the future. As I said to David Chaytor earlier, although this can become confusing it is important that we have different fora in which we can raise some of the issues that need to be raised if we are to have an overall international framework to tackle climate change emissions. I have perhaps more concern in terms of capacity when it comes to some of the developing countries. We are a relatively big government with a good level of resources when it comes to tackling these sorts of issues. Some of the smaller developing countries do not have that expertise, and that is why in the past in areas like trade policy we have funded capacity-building initiatives to try to ensure that the voice of developing countries is strongly felt. Q24 Mark Pritchard: In the written ministerial statement on 11 October on the meeting in Mexico it was said that "urgent global action" was needed. You have rightly spoken this morning about leadership and the Government's need to lead on this important issue of climate change and related issues. You said that the Government needed to get across its message, with which I certainly agree. You spoke about working with international bodies but also alluded to the fact that we needed to act locally. In that regard, having said what I have said do you think there is any sound environmental reason why there should not be a climate change Bill in the Gracious Speech? Ian Pearson: I am not going to be drawn into saying what is or is not in the Queen's Speech. What I did say to the House yesterday was that, as we said in the climate change programme and the energy review, we were considering the case for a carbon budget very carefully, but we should not be under any illusions. What is important here is that we take action. To legislate for a target is something that we are looking at as a government, but just passing a Bill does not mean that we are tackling the problem. What we need is an effective policy response and that is the matter on which we are focusing. Q25 Mark Pritchard: To be helpful, would you be surprised or disappointed if such a Bill was not in the Queen's Speech? Ian Pearson: I do not want to make a comment at this stage as to whether or not a climate change Bill is in the Queen's Speech. The matter on which we all need to focus is effective policy actions. Do we have the right suite of policy instruments to tackle climate change? We have the important goal of reducing CO2 emissions by at least 60 per cent by 2050, but there are other countries with similar goals that are not being met. We are one of the few countries on course to meeting our Kyoto targets because we are taking action. Simply setting targets without willing the means is a futile exercise. Q26 Dr Turner: It is true that the reason why we are meeting our Kyoto targets is not because of any action that the Government has taken but because of the dash for gas as a result of the market. That is not, however, the question that I want to ask. Ian Pearson: I disagree. Since you have said it let me say why I disagree with you. There has certainly been an increase in gas usage in the United Kingdom and that has helped to reduce CO2 emissions. It is also the case that over the past couple of years because of high oil and gas prices power generators have been burning more coal and that has created problems in terms of rising CO2 emissions. But it is not correct to say that government has not taken any action. It is estimated that if the Government had not taken action at this moment we would have been 15 per cent higher in terms of greenhouse gas emissions than we were in 1990 as opposed to 15 per cent lower as we are today, which is why we are meeting our Kyoto targets. That arises because of a range of government actions in relation to tax, spending and regulation. Q27 Dr Turner: That is very good to hear. I want to ask a completely unfair question. The international negotiating industry on climate change has been going on with ever-increasing intensity and elaborateness for some years. Over the course of those years the levels of greenhouse gases in the atmosphere have been increasing at an even higher rate. When do you think we will reach a point when the process of negotiation will produce agreed international measures which will start seriously to reduce emissions? I know that that is a terribly unfair question, but that is really what we have to look for and at the moment we seem to be a long way from it? Ian Pearson: First, greenhouse gas emissions are not going up everywhere. The UK is on course to achieving almost a doubling of its Kyoto targets. Q28 Dr Turner: I am referring to global emissions. Ian Pearson: There are other countries - not enough of them - that are on target to meet their Kyoto commitments. Phase 2 of the EU emissions trading scheme is designed in part to help other countries in the European Union to meet their Kyoto targets. One gets back to the point that it is one thing to set a target and make it legally binding but quite another to achieve it. We are doing that in the United Kingdom. I do not know when it will be possible to reach an international agreement on what a post-2012 Kyoto framework might look like. I do know that it has to be a lot more ambitious than Kyoto. We will all have to agree collectively to go further. I know that it needs to include key emitting nations and that at the moment the United States is not on board. I also know that we have some difficult discussions with rapidly developing countries like China and India which are increasingly burning large amounts of fossil fuel. All this is taking time and will continue to do so, but I know that there is a sense of urgency here. We need to reach an international agreement as soon as possible. That is why we have been trying to build consensus through the G8 Gleneagles dialogue and we will be an active voice in Nairobi. You will not find any lack of political will when it comes to the stance of the UK on these issues. Q29 Mr Caton: Can we look now at preparations for MOP and COP and what has happened since Montreal following what you have just said? I am looking first at what happened in Bonn. A lot of people who have contacted us were very disappointed at what they felt was a lack of progress there. How do you feel about it? Was enough done in Bonn to maintain whatever momentum we had from Montreal? Ian Pearson: Progress was made in Bonn and it had pluses and minuses. My understanding of it - I was not at the meeting - is that on the positive side there was a sense in some of the conclusions that we could move on by looking at the wider framework issues, such as clean development mechanisms, trading approaches and different sectoral approaches. On the minus side, I think that at Bonn some of the disagreements that exist now emerged. Clearly, there is a view among a number of the developing countries that can be summarised, if I may be blunt, as, "Well, you are the rich countries. Just set targets and get on with it." Developed countries say that it is a bit more complicated than that. There is a need for a range of practical actions and just setting targets for the sake of it will not make a difference and we need other people on board like the United States. That disagreement between the G77 and developing countries was, I understand, apparent at Bonn. It is one of the matters that we have to deal with as part of the process of getting a long-term international agreement. Q30 Mr Caton: Thinking more generally, can you point to positive developments over the past 12 months that lead you to believe that we will get successful and very useful negotiations at Nairobi? Ian Pearson: We will have to see what comes out of Nairobi. In a minute I will say something about our objectives for Nairobi. As to positive developments, I think that when published the Stern review will be very influential. The energy technology perspectives report at the IEA is an important piece of work and the proposals that are emerging in terms of the World Bank and the setting up of an energy investment fund are positive. All of those I point out as giving signs that the science is accepted and we know some of the costs involved, and we have some of the mechanisms to provide solutions. I believe that some of the building blocks are there in a way that they probably were not 12 months ago. Q31 Mr Caton: Looking at the flip side of the coin, is there anything that has happened over the past 12 months that you believe may have a negative impact on Nairobi? Ian Pearson: I do not think there is anything I want to point to that I think would be particularly negative. The past 12 months have just confirmed the science. Almost every day we see more scientific reports to indicate that the situation on global warming is more alarming than we first thought. Even in the United States there is recognition that global warming is an issue and there is a need to take action. I do not believe that there have been any particular negative developments over the past 12 months, but clearly there are huge difficulties in trying to get 189 countries to agree to anything. Q32 Mr Caton: Partly for reasons that you suggested in earlier answers, a lot of people look to the UK and the EU for leadership and, therefore, as a quid pro quo we take responsibility if we do not get new progress at Nairobi. Do you believe there has been enough progress in the UK and EU over the past year that will prove particularly beneficial in the outcome of Nairobi? Ian Pearson: There has certainly been progress in the UK with regard to our domestic climate change programme launched in March. I think that the energy review has been helpful. People can see that we are taking a range of actions to reduce CO2 emissions and they can also see from phase 2 of the EU emissions trading scheme that Europe is making further progress, using market-based mechanisms to tackle CO2 emissions. Europe has also put out for discussion that it may want to reduce greenhouse gas emissions by 15 to 30 per cent by 2020 and by 60 to 80 per cent by 2050. I think that is a helpful way to move forward the debate. I believe that in the UK and Europe we are showing leadership here. Q33 Mr Caton: We are certainly doing very well against the Kyoto standards, but there is evidence of some regression in carbon emissions in the UK and slower progress than some expected across the EU. Do you think that affects our integrity as climate change leaders at all? Ian Pearson: I think that when you look at the figures you will find we are well on course to meeting our Kyoto targets. It is true that CO2 emissions in the UK have gone up a little in recent years, largely as a result of high oil and gas prices and so more coal is being burnt. But when one looks at the energy review and the other programmes that we have in place the UK is on target to reduce CO2 emissions from 1990 levels by something like 16.2 per cent. We will need to go further, but I do not think that anybody internationally seriously doubts the UK's leading international role here. I do not think you can point to another country that has done more when it comes to tackling global warming. Q34 Mr Caton: To finish up with a bread-and-butter issue, some NGOs have raised with us their concerns about whether the Kenyan Government can administer a conference like this. Linked to that, they have raised concerns about the timetabling. It seems to be a much stricter UN day as compared with previous negotiations of this kind which end up with long and arduous meetings but with real progress being made in those extra hours. Ian Pearson: I have confidence in the ability of the Kenyans to organise an effective conference. At the moment the timetable might suggest a finishing time of 6 pm. I would not be surprised if after a few days negotiators went well into the night to discuss some of these issues. I think it is very helpful that the conference is taking place in Nairobi. Part of the way these things work is that there is a system of rotation. It was going to be held in Africa. Clearly, climate change is a huge issue when it comes to Africa. It is right that we hold it there. Certainly, there will be a strong focus on adaptation in Nairobi. That is today one of the most pressing issues facing countries in sub-Saharan Africa. They can rightly say, "We did not create this problem but we know that climate change is already there and will affect our countries. We need to adapt and discuss how you help us with that and pay for some of the costs of what you have done in pumping CO2 into the atmosphere as a result of your industrialisation." It is right that that is a subject of debate at Nairobi. Q35 Mark Pritchard: Referring to CO2 emissions, I meet a lot of people who want to have electric cars or put biofuels into their cars but there is very little supply of that. Do you have any comments with regard to oil refiners and petrol producers at the point of sale who perhaps are not meeting a demand that is there because it is too costly to refine biofuels products and get them to market and therefore there is a missed opportunity, as suggested earlier? As we speak this morning, there are people out there who would like to fill their cars with biofuels as they do in Brazil and other parts of the world but cannot do so because the big oil giants here do not have any incentive or are not regulated to do so. What will the Government do to encourage, induce or tell them to get biofuels, electric pumps and a whole lot of alternative renewables to the forecourt and match their rhetoric and large broadsheet advertising showing how green they are with the reality on the ground from the point of view of the average driver? Ian Pearson: As you know, there is a range of different technologies potentially available which can bring about greener motoring from electric cars, hybrids to cleaner fuels and other areas as well. Dealing specifically with biofuels, you will know that the Government is introducing a renewable transport fuels obligation which will be five per cent in 2010. We said in the energy review that we aimed to go further after that date. That is already stimulating some strong growth in the biofuels market, admittedly from very low base levels, but we have started to see major capital investment projects coming forward in the UK. I have no doubt that that will continue as the RTFO comes in over the next few years. I believe that we will see a growth in biofuels as a result of this obligation. We are behind other countries. You mentioned Brazil. Clearly, we do not have the natural advantages of Brazil or other countries. Q36 Mark Pritchard: When you say "advantages" what do you mean? Ian Pearson: Brazil has enormous resources in terms of climate and land to enable the efficient production of sugar cane which is the main source of biofuel production in that country. We do not have those advantages, though we are seeing biofuels being produced in the United Kingdom from UK sugar beet and also from waste oils. This is an area where we have a strong interest as a government. We are doing things through the RTFO, and I am sure there is more that we can do in the future, because I know that transport emissions are an area with which this Committee has been concerned. As a government we are certainly concerned about that. Q37 Joan Walley: I want to concentrate on the preparations for Nairobi and the step-by-step things that the UK leadership can do to get us where we need to be. Following on from the questions Mr Caton asked earlier, it seems to me that the three strands of what is happening at Nairobi are: the continuing long-term co-operative work; the first stage of the review of the Kyoto Protocol; and the work on the further annex. Of those three different aspects, how important do you regard the need to ensure the continuing co-operation between those countries that have not necessarily signed the Kyoto Protocol? Is it just a question of keeping them on board for political reasons, or is there a likelihood that that could diverge from the two other aspects of the agenda at Nairobi? Ian Pearson: I think there are very strong reasons to keep the non-Annex 1 countries on board in the discussions, not least because some of them are major emitters of greenhouse gases. If we are to achieve our goal of a long-term international agreement that is robust, durable and fair to all countries we must have some of those key emitters on board. We will do that only if we continue to make sure that they are as involved as possible in the convention dialogue. Q38 Joan Walley: Is that aimed primarily at the US? Ian Pearson: I certainly have the US in mind because it is the largest emitter of greenhouse gases in the world today. It is difficult to conceive of an adequate response to the problems of global warming that does not involve the United States taking action. Q39 Joan Walley: Returning to the review of the Kyoto Protocol, do you think that it will start smoothly in Nairobi? Do you foresee any early problems being flagged up? Ian Pearson: I am aware that some of the G77 countries ask why a review is necessary because Kyoto is working perfectly well. Why do we not just make further commitments post-Kyoto? Maybe it will not run completely smoothly, but what we need to do is have the debate about what the framework post-2012 looks like and what new policy actions we need to take. For instance, earlier we discussed deforestation. There are other sectoral approaches. Aviation is a huge gap in terms of what needs to be done if we are to have an effective global policy to reduce greenhouse gas emissions. As you know, it was not part of Kyoto, but I believe that it must be part of what we do post-Kyoto. We need to have those discussions. Q40 Joan Walley: Presumably, you have the added problem of front pages of the national media criticising ministers for making journeys by air when they are attending the very meetings to try to get this flagged up? Ian Pearson: We have to live with that. I do not think that the article in the Independent was the fairest one I had ever seen. We will not get international agreement by email. Maybe the Independent has a better way of doing this, but I think that to get round a table and meet people has to be the way forward and we need to continue to do that. Q41 Joan Walley: How long do you expect the preliminary negotiations as to what may happen post-2012 to take? Do you think that you will complete it at Nairobi? Will it be part of another ongoing series of talks? Ian Pearson: I would love to say I feel confident that everybody is going to Nairobi with the expectation that there will be a long-term international agreement, but I do not think that is the case. What we can realistically expect from Nairobi is to advance some of the discussions and shared understanding so that hopefully we agree an adaptation work programme and fund which will be an important issue for developing countries. We will need to discuss the distribution of the clean development mechanism, which will be a major topic at Nairobi, and the whole issue of technology transfer. Earlier I mentioned the need for low-cost carbon solutions in developing countries. More will need to be discussed in Nairobi in relation to that, but I do not yet sense that there is an international consensus on new targets at Nairobi. Q42 Joan Walley: There is a contradiction in the sense that in relation to manufacturing the more we can achieve in the UK or perhaps Europe to reduce emissions there is a danger that much of that will be displaced to India or China in advance of any of the new clean mechanisms having been adopted as a means of manufacturing there. Effectively, we will be keeping our side of the bargain but that manufacturing is being transferred to other countries where global emissions are going sky high until we have the new mechanism in place. How do you think we can ensure that we have that kind of commitment from industry, perhaps linking it with the WTO as well, in the core of the new negotiations that need to be part of this ongoing annex and further negotiations post-2012? Ian Pearson: I fully understand the concerns here. We cannot just focus on what are sometimes called end-of-pipe solutions. Just closing down a UK manufacturing plant because we impose onerous regulations on CO2 emissions and seeing that same activity transferred elsewhere where there are no such regulations does not do the world any good. Clearly, we need to make sure that we are not in a position where, for instance, ceramics companies in the Stoke area transfer production to China which uses less energy efficient and more polluting technologies and then claim CDM credits for it. That does not seem to me to be a sensible way to do things. One of the benefits of the EU emissions trading scheme has been that it enables the least cost solution to reduce CO2 emissions to take place within a European context. I think that that has been very beneficial. I am proud that the UK was the world's first country to introduce an emissions trading scheme and was the lead architect of the EU ETS. I see those trading mechanisms as playing a part in the future. One of the debates that I believe we need to have is how we can expand those trading mechanisms and how the EU ETS can link in to trading schemes in other countries in future, how it links in with the clean development mechanism and what we need to do with regard to that post-2012 because we will need to do more in that area. Q43 Joan Walley: Are you putting that on the table in respect of Annex 1 discussions at Nairobi? Ian Pearson: I am not sure whether discussions will go in that particular direction. A lot of the focus will be on the adaptation work programme and fund. I am sure that there will be a big discussion on technology and the fact that at the moment Africa hardly benefits from the CDM. Some of that is to do with the fact that there are not major CO2 emissions in a lot of countries in Africa. The exception are South Africa and one or two other countries. The CDM has been used in big projects in China and India and African countries think, rightly, that it is not necessarily fair to them or helping them. We need to find a way to address that issue. Q44 Dr Turner: How optimistic are you about progress on the Kyoto Protocol in the ad hoc working group at Nairobi? Do you know what sorts of things are on the agenda, and how much resistance do you expect from the G77? Ian Pearson: I believe that at Nairobi there will be a big focus on adaptation overall. There is certainly a strong feeling on the part of developing countries that they should not be expected to make commitments and sign up to targets, but overall I believe there is a recognition that sooner or later nations together will have to tackle this problem. How far we get at Nairobi with some of these discussions on whatever track, whether it is the convention dialogue or the ad hoc working group, we will have to see. I do not have big expectations, but I believe that we will continue to have a dialogue and build a consensus. The more people who are exposed to the increasingly alarming science the more they will recognise that there is a growing sense of urgency here. Q45 Dr Turner: You have already said that you are fairly pessimistic about the prospects of developing a post-Kyoto Protocol. Do you say there is a brighter chance of getting progress in the working group to make Kyoto stick and produce results? Ian Pearson: I am not sure I used the word "pessimism". I said that I did not believe we would do the big deal at Nairobi that needed to be done in the future. The meeting is not really set up for that purpose. Clearly, there will be a discussion amongst Annex 1 countries as to whether they are meeting their current Kyoto targets. You are right to highlight that as an issue, because we need to make sure that the commitments which countries have made are honoured and delivered. It is legitimate for people to say, "How can we even talk about what happens after Kyoto if we are not going to deliver on Kyoto?" We are doing it in the UK, but we need to face the fact that some countries are way behind in terms of meeting their Kyoto targets. I am sure that that will be pointed out during the course of the two weeks of plenary meetings and negotiations at Nairobi. Q46 Dr Turner: What about the countries that have not even signed up to Kyoto? What will you do at Nairobi about the Americans, Australians and so on - the biggest per capita polluters in the world? Ian Pearson: We continue to have a healthy dialogue with the United States on this issue. As you know, it is not the case that nothing is happening in the United States when it comes to tackling climate change. We have seen the recent announcements in California in terms of the Bill that that state has introduced and the proposals for an emissions trading scheme with the north east states of the US. Q47 Dr Turner: But the federal administration is not involved. Ian Pearson: Yes. Let us not neglect the number of American cities that have signed up to Kyoto. There is no hiding the fact that we have an issue with the federal government and there is no desire on my part to do so. I believe that a lot of people are saying, "This administration does not seem willing, and has not proved willing, to do anything at a federal level in terms of targets and commitments. Let us see what the next administration does." A number of other countries are basing their negotiating stance almost on what happens after the next US presidential election. Q48 Dr Turner: If the Grand Old Party continues to hold the administration that may not be a good strategy? Ian Pearson: I do not want to speculate on American presidential elections. I just want to make the point that there is a growing recognition on the part of people and politicians within the United States that America needs to do more. If we can get to a stage where America wants to play a leading role in climate change negotiations I think that will be enormously helpful in terms of delivering a positive outcome. When one looks at the fact that 20 per cent of global CO2 emissions are attributable to the United States there is no doubt that one needs the US on board. Q49 Joan Walley: To go back to Nairobi again, there is a sense that everything is really a vicious circle. We need to be there. Where is it we need to be? What is the overall objective? I think the Prime Minister said it is essential that all countries sign up to a stabilisation goal and we also have a framework for binding targets but also a route map, if you like, to get there. From where I sit it is very difficult to see which of those is likely to be the first one that can be agreed as a result of what takes place in Nairobi. How do you see this panning out? Ian Pearson: As a government we certainly believe that we need a goal for stabilising CO2 emissions. The position of the European Union is that we need to avoid dangerous climate change by making sure we can limit the maximum increase in temperature to below 2˚C. What comes first, whether it is practical action or agreement on an overall framework with targets, is an interesting question. I am not quite sure what the ultimate answer will be. What we have tried to do in the United Kingdom through the Gleneagles dialogue as well as the UN process is to talk to countries and encourage them to take practical action on the ground. In Mexico agreement was reached with South Africa to deliver some practical projects. We have other projects with key countries. The EU's project with China, heavily influenced by the UK, on near zero emissions coal is I think very important as a demonstration project for the future. I think that it has to be a mix of continuing the debate and discussion about a stabilisation target, the whole international framework and encouraging practical actions as well. One has to have both targets and a strategy that include a set of specific measures to enable one to reach those targets. That is why I believe things like sectoral approach and discussing deforestation and aviation are very important in that context. Q50 Joan Walley: At this stage it is very difficult to see just what is achievable. What is achievable will depend upon how we shape the very complicated architecture that we need. I want to return to the memorandum that we received from DEFRA about the discussions which took place in Bonn. I believe that some countries felt that Kyoto perhaps needed to be abandoned or replaced with something else. Can you tell us which countries those were, or whether or not that is still an issue? Ian Pearson: My colleague was at Bonn. Ms Droogsma: What became clear in Bonn was that there were some different positions as to what the future should be. On one extreme there were a few countries, for example Saudi Arabia and India, that felt that nothing had to be changed and it was fine as it was. We should just keep the Kyoto Protocol and that is it. At the other extreme, countries like Japan and Canada felt that we really needed much more, and probably something quite different, to face up to the challenge. There are a lot of models in between. As the Minister said earlier, what Bonn shows is that at the moment we are still coming from very different angles. The challenge is to bring those angles together, which takes time. That is why one needs dialogue not just within the UN framework but within Gleneagles to make sure one gets the consensus moving towards one point. Q51 Joan Walley: In terms of what is possible at Nairobi, is it the case that Kyoto can be amended somehow or other to take on board the different perspectives of different countries and the lack of clarity, or do you think that at some stage for political reasons we will have to negotiate a completely new Kyoto Protocol? Ian Pearson: We have Kyoto and I do not believe there is any substantial wish to change it and rip it up. Countries like Canada say, "Well, we should never have signed up to the commitment that we did. There is no hope of making it. It was the fault of the previous administration in signing up to it and we will not be held to that as a target", but elsewhere there is a strong feeling among our Annex 1 parties that Kyoto was important as a landmark and we need to deliver on it. The key point is not to reopen the Kyoto commitments but to say that we should deliver on them and, at the same time, start to discuss what the new commitments and a framework that is bigger and more ambitious than Kyoto will look like. Let us make sure that we have all the countries involved in this and that some of the things missed out at Kyoto, like aviation, are tackled. Q52 Chairman: Just looking at the post-Kyoto phase and what we may build on it, what is the latest government thinking about contraction and convergence as a long-term goal? We face a good number of options now, but a lot of them would be quite consistent with a long-term commitment to achieving contraction and convergence? Ian Pearson: I know that Colin Challen would have raised this issue with me had he been here. Our view is that if the Kenyans decide to table contraction and convergence for discussion at Nairobi we will be very supportive of it, but we see it as one of a number of models that potentially can provide a way forward. You will be aware of Brazil's historical responsibility proposals. There are other ideas around at the moment. I think that the best summary of our position is that we want something that works. We are interested in all ideas and want to see whether there is a consensus on any particular elements of those ideas as a way to move forward. Certainly, contraction and convergence has its good points. There are some countries that do not like it and have major problems with it; similarly, there are those in favour and those against some of the views expressed by Brazil, for instance. We need to try to navigate a way through. Whether it is contraction and convergence or other models that are taken forward I do not think that it is something about which we should be specific at this point. It would be wrong to try to champion one particular model. We need to look at a whole series of models and try to find out what offers the best opportunity of working with that critical mass of people who want to sign up to it. Q53 Chairman: Given that the Kenyans decide to table a discussion about contraction and convergence, would you not want Britain's position to be rather more precisely defined than you have just said? Ian Pearson: No. I think it is a good contribution to the debate that we need to have, but it is not necessarily the answer. There could be other and better approaches. At this point in the discussions I do not think it is right for the policy stance of the UK Government to be seen to be strongly backing one particular model over another. What we want to do is try to play a leading role in brokering a deal. I do not think one does that by trying to force a model on some countries that just do not want it. Q54 Dr Turner: To return to the debate on frameworks, is not the debate about which countries will accept what binding targets? Is there not a very real problem that there are countries which will accept targets only if they think they can easily achieve them, so you have only soft targets that do not make the contribution that we need? Ian Pearson: The fact that a significant number of countries are not on course to meet their Kyoto targets does not lead me to conclude that countries signed up only because they thought they were soft when they were negotiating the Kyoto Protocol. I do not particularly agree with the view that countries will sign up only to soft targets. The fundamental point I make is that it is one thing to agree or not agree a target; it is quite another to deliver a range of actions which will get us moving in the direction that we need to move towards. It may be that a mix of countries agreeing to formal targets and countries agreeing to take action may be a way forward in future. I think that we need to discuss some of those issues at Nairobi and subsequently. Q55 Dr Turner: The other matter which creates an impasse is that there are still countries which feel that any action on climate change will be at the expense of their economic development and cannot see their way towards the principle of de-coupling CO2 emissions from economic development. How do we break that particular impasse? Ian Pearson: The UK has some really good experience here. Since 1997 our economy has grown by 25 per cent and we are on course to hit our Kyoto targets. We have employment levels that are among the highest in our history. I think we can say that when it comes to de-coupling economic growth from CO2 emissions it has largely been achieved here; we can point to our economic success as proof of that. At a sectoral level - transport and aviation emissions - there is still a problem, but it is quite clear that this can be done. It is equally obvious to me that when we look at developing countries, particularly some of the poorer ones, there are real prospects for them to leapfrog the UK in terms of the way we developed and our experience in technologies. They can immediately jump to low-carbon solutions in a way that we did not do when we were industrialising in the nineteenth century and for most of the twentieth century. Q56 Dr Turner: Do you anticipate that Stern's report might give useful ammunition in getting across these messages? Ian Pearson: I think that the Stern report will provide extremely useful ammunition and some powerful arguments about why it is in everyone's interests to take action now rather than delay. I hope that with the combination of Stern, the availability of technologies and funding through the World Bank we can see some of the poorest developing countries immediately setting out on low-carbon growth paths. Q57 Joan Walley: If we go back to the comments at the start of our proceedings, it would be very helpful to have the Stern report published before Nairobi. Ms Droogsma: To add something to that, Sir Nick Stern will give a presentation in Nairobi in a convention dialogue on the first day, so it is imperative that it is published. That will be a major opportunity for all 189 countries in the room to be told about the findings. Q58 Dr Turner: That would be very helpful. You made it clear that you did not expect a post-Kyoto framework to begin to emerge at Nairobi, but in what timeframe does the Government see that happening or is working towards? Ian Pearson: We want to see international agreement as quickly as possible because we believe that this is an urgent issue that needs to be tackled now. One cannot realistically put any particular timescale on it because we are just one of a number of countries that are involved in a complex international negotiation. All I can say is that we will do everything we can to build an early consensus on what that post-Kyoto framework should look like. Q59 Dr Turner: One element as far as Europe is concerned is the effort to establish a price for carbon. How do you see carbon pricing fitting in to a post-Kyoto framework? Ian Pearson: The price for carbon is really important for the future. At the moment the price is set in the market through the emissions trading scheme, and that is probably the best way to do it. But I want to see it evolve so that there is a world, not just a European, price for carbon. That is why the ability to extend the EU emissions trading scheme is important. One of the negotiating objectives of the UK Government is to make it easier for other countries to link in with the EU emissions trading scheme in future. Obviously, we need to ensure that we have a carbon price which those in the market who are making long-term investment decisions know will be at or around the right level to bring forward investment decisions in low-carbon technologies. That is an important way to ensure that we get a roll out of carbon-catching and carbon storage and other key technologies that we will need for the future. But at the moment I recognise and accept the fact that there is some market uncertainty about the long term price of carbon. The more we can do to bring certainty within Europe and wider the better it will be in terms of moving forward the whole agenda. Q60 Dr Turner: But in order to make that a practical reality on a world scale you will need to bring in countries like India and China. Do you see any prospect of that? Ian Pearson: I would dearly love China to decide that it wants to introduce an emissions trading scheme and for it then to decide that it wants to link that scheme with the European one; similarly with India. Whether or not that will happen I do not know. More realistic shorter-term prospects might be to look at how some of the states in the US could be linked into the European emissions trading scheme. At the moment that is difficult because the US is a non-Annex 1 country and it would, as I understand it, mean amending the directive, but we need to look at these sorts of things. I am a climate change optimist. I believe that in 20 or 30 years we will have a global price for carbon, and that is certainly something towards which we need to move if we are to de-carbonise our economies worldwide. Some of the recent science that I looked at is really scary. If one looks at the growth in population, by 2050 it is likely to be nine billion. If one looks at the cost of feeding that population some things can be done in terms of low carbon production; in other cases that is not so. Basically, some of the science says that the amount of carbon required to feed nine billion people will take all the carbon emissions that our world can take if we are not to have dangerous climate change, so everything else will have to be zero carbon. Therefore, it means zero carbon transport and power generation which is a huge challenge for us. Q61 Dr Turner: And you are still an optimist? Ian Pearson: Yes. I believe that in Europe we can move to zero carbon power generation in future and that must be a goal for us. Q62 Chairman: As far as Europe is concerned, will the period which the third phase of the emissions trading scheme system in Europe covers have to be settled before we know what the period covered by the post-Kyoto phase worldwide will be? Ian Pearson: As you know, we are starting a process of reviewing the ETS and what phase 3 might look like. I suppose my initial reaction is that I want the phase 3 to be more ambitious, to have tighter caps and to be longer term than phases 1 or 2. At the moment the emissions trading scheme is designed with an explicit link to Kyoto, so one is talking about a very different animal if one is considering something without a Kyoto link. Clearly, if we can get early agreement on an international framework and commitment in time we can link the ETS to a new round of commitments. If not, the last thing we should be doing is to decide not to have a phase 3. We must have a phase 3. Whether or not it has a target linkage, the most important thing is that it is there and bears down on CO2 emissions. I do not think that anything more realistic can be said beyond the timing of the two events. Q63 Chairman: You referred to some of the more alarming scientific projections. Given that and the fact that the meeting is taking place in Nairobi, are you concerned that there may be a considerable focus on adaptation and less attention paid to cutting emissions and the actual concentrations of greenhouse gases? Ian Pearson: There will definitely be considerable attention paid to adaptation, and rightly so. When one looks at many of the Annex 1 countries and those that did not sign up to Kyoto, a large number are very small emitters; they are not a big part of the problem in terms of finding a global solution, but they will be affected by the climate change that is already in the system. I sometimes think that we in the UK do not focus sufficiently on adaptation. Because of lags in the carbon cycle a certain amount of global warning will already with us over the next 20, 30 or 40 years. We will have to adapt in the UK, which is why we have work going on in an adaptation policy framework. That is a really urgent need in some other countries in the world where adaptation will be absolutely central to them. That is why it is important that this is a topic of discussion. Q64 Chairman: You did refer to historical responsibility and the Brazilian proposal. The memorandum also refers to the fact that Britain and Germany helped Brazil in developing the technical merits of that. You were quite cautious in response to my question about contraction and convergence. Is there a bit more sympathy for historical responsibility? Perhaps you see it as another form of pressure that can be exerted on some of the Annex 1 countries. Ian Pearson: As I hope I have made clear, we do not favour one particular model over another. We are keen to support the development of ideas, whether it be contraction and convergence, historical responsibility, the framework or other models. It is only by going into some of these issues that one can find out whether or not they will have widespread support. Having said that, whatever model is eventually agreed there is no doubt in my mind that the UK has a historical responsibility as the first nation to go through an industrialisation process. I believe that we have a moral responsibility to show leadership on this issue and need to take into account the CO2 emissions produced by the United Kingdom in the past. I do not think that at this stage it is possible to say how that is determined. I do not believe that the average person in Britain would deny the fact that this country has contributed to the problem and as a result it will have to do more than other countries when it comes to providing the solution. Chairman: We have gone a couple of minutes past the time that your office indicated was your deadline. Thank you very much for coming along. We have had a useful exchange. I am sure we shall see you again before long. |